Tough Enough

Xiao-Hong Jing knows a little too much about what it means to persevere. She grew up with her parents and two siblings in Tai Yuan, a large industrial city in the Shan Xi Province in China. But at age six, she was sent to live with her aunt in Shanghai. It was a traumatic event for more than just the obvious reasons--she couldn't understand the Shanghai dialect and had never met her aunt before. She made the best of her new life, though, eventually attending FuDan University, one of the biggest colleges in Shanghai. Two years intoher studies a teacher encouraged her to apply to Wellesley College in Massachusetts. She did and was accepted.

It was a huge leap of faith for Jing, who not only had never been on an airplane before, but also had barely travelled outside Shanghai. The only thing she knew about the U.S. was what she had read in books. The toughest part of her transition was dealing with all the choices now available to her, from the classes she could take to the food she could buy at supermarkets. She quickly learned how to make the best of those choices and opportunities.

After graduating from Wellesley in 1992, Jing decided to go to law school. She visited three schools: Yale, Harvard and Stanford. She picked Yale because the students were much more relaxed than those from Harvard or Stanford. After graduation, she went on to practice in the investment management group of Davis Polk & Wardwell. But after the birth of her second child in September 2000, she wanted to spend more time with her family. With the help of a recruiter, she landed the job of general counsel of Asset Alliance Corp., a New York-based hedge fund. The company is not only an investment house, but also acquires equity interests in established fund managers and offers seed money to startup fund managers.

Q: Before we talk about Asset Alliance, I have to ask you a question: Why did you have to go live with your aunt?

A: The main reason was because my mom's sister got married very late and didn't have any kids. She wanted a kid, and I was the third child in my family and the second girl. And so my mom said, 'You can have Xiao-Hong.'

Q: That had to be tough.

A: It had quite an impact on me. I showed up in Shanghai with my mom, and I had never met my aunt before. I also had never been outside of Tai Yuan. All of a sudden I'm in a brand new environment where I don't speak the language. In China there are many dialects. They are like foreign languages. I had no idea what the other kids were talking about.

Q: Eventually you ended up in the U.S. Why did you leave China?

A: It was the education. I realized that I would have a much better opportunity to study English literature in the U.S. than China. I only applied to Wellesley. It's interesting because if I hadn't been accepted, my life would be very different right now. If I had stayed, I would have finished at FuDan and would probably still be living in Shanghai.

Q: In college you won an award for fiction writing. Do you still write?

A: I have been writing in a diary ever since I was little. I've pretty much continued doing that. It's something I like going back and reading from time to time to see all that has happened to me.

Q: So why law?

A: The law has its own language. I loved studying languages. Law was a natural fit for me.

Q: You left Davis Polk to find a better work-life balance. But I would imagine that a hedge fund has to be a pretty stressful place to work, right?

A: It's stressful in the sense that you know every day there is a lot going on. It's stressful while you're here at work. But unless I am working on a transaction, I know I can spend time with my family on the weekend. When I was doing M&As at the firm, I would have to work at least one day on the weekend. And you can't ever schedule anything because you know that something can happen at the last minute. The workload is much more manageable and predictable.

Q: What does the general counsel of a hedge fund do?

A: Well, it combines a lot of the things I worked on at Davis Polk such as banking, M&As and regulatory issues. We also do a lot of general corporate work like employee contracts, shareholder buybacks and stuff like that. We also have fund products so we have to worry about fund-formation work and ongoing operations of funds, as well as lots of

compliance issues.

Q: Is there one issue that takes up most of your time?

A: It's different every day. I feel like I deal with a little bit of everything on an ongoing basis rather than just focusing on one area.

Q: What do you think is the most challenging part of your job?

A: The most difficult part would be juggling my time between all these different things and making sure everything is covered.

Q: What is the worst part of your job?

A: Filing registrations. But now we have a chief compliance officer, so I am hoping she can take that responsibility.

Q: What advice do you have for someone who is looking to become a general counsel of a hedge fund?

A: You really have to understand the business. There are so many different hedge-fund strategies and so many different types of hedge funds. You have to know what your company's strategy is and how they are actually making money with that strategy. You also need to know what types of investors are going to be investing in your fund.

Q: Hedge funds have been involved in a lot of scandals recently. Does the industry have a problem?

A: The reason that they are in the news is that there are many more hedge funds out there than there were 10 years ago. But I don't think the industry as a whole has a problem. People are just taking more of an interest in hedge funds.

Q: How do you make sure the hedge-fund managers that Asset Alliance partners with aren't doing things that might reflect badly on the company?

A: Before you acquire a fund manager, you want to do a lot of due diligence from all levels and all aspects. And then once you acquire the manager, the most important thing is to have regular communications with the manager so that you know what's going on.

Q: Has your background growing up in China helped you in your job?

A: I don't think so. I really haven't had to use the language much, and hedge funds aren't that big in China.

Q: Would you ever go back to China?

A: It's a possibility. It is a little more complicated now that we have two kids. But I still see that as a possibility. I've been talking with friends, and interestingly most of my friends from Wellesley and Yale who are from China are now back in China. There are just so many more opportunities there now.